Adobe CEO admits need to 'tweak' Creative Suite's cloud-only policy

Adobe dropped the D-bomb during a Q2 conference call with analysts after admitting some customers are "disappointed" it decided to murder future copies of its boxed Creative Suite.

Clearly top brass at the company were living in er…cloud cuckoo land when they revealed last month that future Creative Suite versions would only be web-based, a move that went down badly with some channel partners and their customers.

The impact of this metamorphosis into SaaS provider was apparent in Adobe's Q2 sales, which slumped ten per cent to $1.01bn as net profit dived 66.8 per cent on a year ago to $76.5m.

CEO Shantanu Narayen talked up the cloud at every turn during the call with financial analysts, stating that the "overwhelming" majority of customers that bought via its website had chosen Creative Cloud rather than CS 6, the last boxed version.

It exited the quarter with 700,000 paid subscriptions in the Digital Media unit, up 221,000 sequentially - the goal is to hit 1.25m by year-end - and he claimed "satisfaction rates are high"

But not among all, he admitted:

"Our decision to discontinue perpetual licensing of new versions of our desktop products has caused concern with some customers," said Narayen.

"While we will still continue to offer CS6 on a perpetual basis, the feedback from our community is important, and we are evaluating additional options that will help them with the transition," he added.

He claimed its "execution" of the Creative Cloud had been "spot on" but admitted it does not yet have a solution.

"We're looking for tweak that would lead to a better customer outcome. We don't have any that we've identified today".

The criticisms from customers centred largely the price, with some suspecting the monthly subscription is just a way to extract more money from users who traditionally skip a generation of software at a time.

Narayen said channel partners are raising "efforts to market and license" the Creative Cloud, increasing adoption of Enterprise Creative Cloud and cross selling the Marketing Cloud.

"We are using our Adobe Marketing Cloud technology to manage and optimise the Creative Cloud customer acquisition process," said Narayen.

In the Q2 numbers, Digital Media unit revenues hit $670m including the Creative product family and the Document Services products, down from $812.5m.

The Digital Marketing business turned over $229.6m, up 17 per cent year-on-year. and Print & Publishing came in at $551m, flat on a year ago. ®